The discovery points to the merging of government-grade and mainstream attack code in the criminal world to produce more virulent malware.

The Gyges code, believed to have originated from Russia, was used to bypass sandbox-based security products that imitate user activity to trigger malware execution within the sealed container.

Other features of the added code included highly advanced techniques to block debugging and reverse engineering, both used by security researchers in analyzing malware.

"Interestingly, the malicious code used for all of these evasion techniques is significantly more sophisticated than the core executable," Sentinel Labs' Intelligence Report said.

The level of sophistication is what led Sentinel researchers into believing the code had been used in government-sponsored data-stealing attacks.

With suspicions raised, the researchers dug deeper into the malware and found that it had been used as a "carrier" for executables used in other targeted attacks.

Those other campaigns have included government-sponsored eavesdropping on network activities, key logging, theft of intellectual property and screen capturing.

Among cybercriminals, the stealthy code has been used in extorting money through ransomware and in online banking fraud. The code has also been found in malware used in creating botnets, targeting critical infrastructure and installing rootkits and Trojans, Sentinel said.

While cybercrime remains the chief motive behind attacks, cyberespionage is responsible for a significant number of data theft incidents.

Linking the attacks directly to specific nation states is difficult. Nevertheless, cyberespionage was behind 505 incidents in 2013 that were analyzed by Verizon in its latest Data Breach Investigations Report.

The U.S. was the most victimized country and targeted industries included professional, scientific and technical services, manufacturing and the media, Verizon said. The public sector was also a major target.

Copyright 2017 IDG Communications. ABN 14 001 592 650. All rights reserved. Reproduction in whole or in part in any form or medium without express written permission of IDG Communications is prohibited.